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tv   BBC Business Live  BBC News  September 21, 2017 8:30am-9:01am BST

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this is business live from bbc news with ben thompson and sally bundock. google strikes a billion dollar deal with smartphone maker htc. will it prove to be a smart move — or another costly mistake? live from london, that's our top story on thursday the 21st of september. the deal with htc is google‘s latest attempts to boost its hardware capabilities — and is its second foray into smartphone manufacturing. also in the programme: eight years in the making and mired in controversy — today the ceta free trade deal between the eu and canada finally comes into force. but can the uk still reap the benefits, post—brexit? and the markets are up slightly at
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the moment in europe, not overexcited by moves from the worlds most powerful central the fed big brother is watching you! businesses now have more personal information than ever before, but how are they using it? we'll hear from the boss of an analytics company later in the programme. and as the music industry has bounced back after a decade of falling sales, thanks to a boom in streaming services today, we want to know — how do you listen to music? do you stream, download or buy cds and vinyl? let us know, use the hashtag bbcbizlive. hello and welcome to business live. as usual we are jam—packed so let's
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get started! we start in taiwan — where in the last few hours smartphone maker htc has struck a billion—dollar deal with alphabet — the company behind google. shares in the taiwanese company were suspended on reports google was planning a take—over of the firm. instead — staff from htc‘s mobile unit will bejoining google, leaving htc to carry on with its other projects htc used to be one of the world's top smartphone makers — mixing it with apple and samsung. back in 2011 it had over 10% of the global market. today the brand's market share has collapsed to barely 1% — as rivals from mainland china have pushed it out. importantly though it makes devices for google — like the pixel smartphone. the deal could help google ramp up its hardware production to compete better with apple. that's the theory anyway. but what
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about the practice? joining us is matti littunen — a senior research analyst at enders analysis. nice to see you. what do you make of this deal? i think for one it proves that hardware is back with a vengeance that hardware is back with a vengeance in smartphone manufacturing. if the latest iphone was any guide, advances in technology, cameras, machine learning hardware are at the heart of the emerging future smartphone experience. it makes sense for google to boost its pixel business. what is funny about all of this is we are constantly told it's about software, how these firms come up with that, but what we are finding now is it's absolutely about
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hardware. yes, we have been shocked by that as well, a perfect storm of different technologies suddenly emerging at the forefront has meant expensive investment and expensive talent is now required to stay ahead of the game. talk to us about the deal which is gec already has —— htc already has with google, what does it allow them to get their hands on? they have been working together since 2008, at the moment htc has been one of google ‘s last remaining reliable partners. this ensures htc's reliable partners. this ensures htc‘s virtual reality business will surprise putted survive and that htc's surprise putted survive and that htc‘s talent has a safe home at google. do you think it's significant it did not buy the whole company, just the bits it needed, unlike mortar role? it's
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interesting, for one the price is much lower, it. have access to the intellectual property and it ensures that htc's intellectual property and it ensures that htc‘s remaining virtual reality business is much betterfinance going forward. it's a complex calculus and we don't know all the details yet but these are the sorts of open questions we have. good to see you, thank you for explaining that. let's take a look at some of the other stories making the news. the federal reserve is to start running down some of the 4.2 trillion dollars of bond investments it made to boost the us economy after the financial crisis. the us central bank will start in october, cutting the amount it invests by 10 billion a month. at its meeting on wednesday the fed also said it was keeping
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interest rates on hold — but signalled a rate hike by the end of the year. toshiba says its agreed a deal to sell its coveted memory chip unit to a consortium led by bain capital. the $18 billion deal is designed to cover billions of dollars of losses incurred by toshiba's us nuclear unit. despite this, sk hynix — that's the korean chipmaker which is also part of the deal — says there are still some issues to be revolved before the agreement is formally completed. pilots working for the travel group thomas cook will stage a 24—hour strike on saturday as part of a dispute over pay. their trade union, the british airline pilots' association, confirmed the strike after five days of talks failed to resolve the dispute. a strike on 8 september was the first by pilots at the company
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since 197a. another story we have been following, news from richard wescott oui’ following, news from richard wescott our transport correspondent, he understands the rya nair our transport correspondent, he understands the ryanair pilots, there has been a fiasco relating to leave allowance, rya nair admitting they have messed up holidays and had to cancel 2100 flights, are transport correspondent said ryanair offered captains a one—off payment offered captains a one—off payment of $12,000 but they said no and they have been offered money if they hadn't backed leave but there are regulations which means the pilots need a certain number of rest days so need a certain number of rest days so this tangled web gets even more complicated. it seems so far there is no end in sight, thousands more flights to be cancelled still as
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result of ryanair messing up holiday allowa nce. just as well, a little thought i had earlier today, bain capital looking like they will buy the memory chip unit of toshiba and they came to the rescue of toys r us a few years ago and they are now back in the news in trouble. let's turn to canada now — because prime minister justin trudeau is celebrating a massive free trade deal with the european union — which finally comes into force today after eight years of talks. it's called the comprehensive economic and trade agreement or ceta — here's an idea of the scale of it. trade in goods between the two sides was worth around 77 billion dollars last year. the deal will eliminate the vast majority of tariffs — or customs charges — on goods and flowing between the two sides. it poses a bit of challenge
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for britain — which led the way in negotiating the deal but will no longer be part of it when it leaves the eu. on a visit to canada earlier this week, uk prime minister theresa may promised a "seamless transition" to a new trade deal with canada let's get more on this with sarah fountain smith, deputy high commissioner for canada in the uk. we talked about eight years in the making, how relieved are you that we are ina making, how relieved are you that we are in a position where this deal is done? the application today marks a new chapter in the relationship between canada and the eu, and as you mentioned it effectively
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addresses or eliminates barriers in all sectors. what good is will be flowing that will be cheaper because of the ta riffs will be cheaper because of the tariffs going? 98% of will be cheaper because of the tariffs going? 9896 of tariff is eliminated today, to give you one example we will see the total elimination of the 8% tariff on maple syrup which hopefully will be welcomed. for the uk it's also important in terms of export items, information and communication technologies, it's across the very significant. very instrumental in coming up with this deal, and it no
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longer will be part of the deal and it leaves the eu, what should the uk be considering when it tries to make these deals on its own? theresa may in ottawa on monday had the opportunity to discuss this with justin trudeau and they both spoke about the importance of maintaining stability and continuity in the canada — uk trading relationship. they reaffirmed their commitment to ceta and the enthusiasm they have about its benefits and importantly agreed they could see ceta as a basis for future discussions between canada and the uk on our own trading relationship was respecting the eu requirements regarding negotiations. good to talk to you, thank you for explaining that. cheaper maple syrup! let's look at the markets.
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in asia, really flat session. let's look at europe. banking stocks doing really well overnight and in asia are all in reaction to the latest news from the fed, and looking ahead to the possibility of financial regulation easing in the us under a trump administration. joining us is nandini ramakrishnan, global market strategist atjp morgan asset management. welcome back, touching on the fed
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stuff, it was a real story as far as the markets were concerned, what will they do and when and by how much? it's a huge day because usually central banks have the interest rate they can play around with, but here we have the fed reducing the balance sheet and all the assets they have got and bought up the assets they have got and bought up over many years, letting those go back into the market, could have an impact on the treasury is, the us government bonds and how those different maturities will perform. there were some out there who were really concerned about the impact this would have when it does start and if it's going to be managed well 01’ and if it's going to be managed well or not, but most people we speak to who work in the city of london or on wall street are not too concerned about how it's being done. wall street are not too concerned about how it's being donelj wall street are not too concerned about how it's being done. i would not say we are too concerned but we
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are watching it closely because it could have big effect on government bonds which most investors have in their portfolios, whether it's a diversification of a safe haven asset. if those prices go down because there is a central bank is not buying those assets it could have a pretty not so good effect on a portfolio so it's important to watch how those government bonds perform. what does it tell us about what the fed is thinking? the employment picture looking a little better but still pretty sluggish growth, what picture does it paint? there are two basicjobs, get an employment to the lowest level it can go and make sure inflation is at a healthy 2%. inflation is the challenge, an employment is good in america but inflation, the price stability increase has not been coming through. what this reaction tells us is the are somewhat happy with the jobs they have been doing
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but will be monitoring inflation and the general us economic growth going forward but overall the fact they are doing this balance sheet reduction at interest—rate movement shows they are comfortable with the help of the economy. finally join the line, may be under the financial crisis. thank you. we will be discussing how you listen to music these days. send in your tweets. still to come... digging beneath the data. later we'll speak to the boss of an analytics company hoping to transform the way businesses look after their customers. you're with business live from bbc news. here in the uk there was a sharp rise in the number of
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apprenticeships in the uk. figures that have come out from the institute of student employers also show small rise in the number of graduates being hired by firms. we can speak to steven isherwood. why are we seeing such a small rise of what is termed as traditional graduates? i think that small rise is due to a couple of factors. one is due to a couple of factors. one is the slight nervousness that we are talking about in the economy, how much young emerging talent organisations want to hire. they are definitely holding firm in most sectors. we are also seeing a shift from pure graduate schemes and also starting to recruit more people through alternative entry groups, through alternative entry groups, through apprenticeship and school either programmes. why are
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apprenticeships backing such force? i remember when i was leaving school 01’ i remember when i was leaving school or college no one was going to do an apprentice ship because it seemed to bea dirty apprentice ship because it seemed to be a dirty word. it was not something you did. why the change of heart? there are two reasons. one is financial and the other is the apprentice levy. employers are paying a payroll tax and they get some of that levy if they use it for apprentice training. that is a direct impact which is coming into play this year. the other is more long—term. employers have been looking at alternative entry routes both to improve the diversity of their intake and also hunting in different tools for the talent and skills they need. for quite awhile, employers have been thinking about different routes, school either roots. the encounter sea firms were major movers in this sector. —— the accountancy firms were a major mover. firms tell us to get the right combination of education, workplace learning and find those
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employees are more productive and they longer. as ever, we're out of time, but thank you stephen isherwood, chief executive of the institute of student employers. the cost of going to university was not mentioned there but i am sure that a factor. there is a story in the independent. dominic chappell could not appear in court because he was offshore on his yacht and not able to get the e—mails. you're watching business live — our top story: google's alphabet has struck a billion dollar deal with the smartphone maker htc. the deal marks the latest move by google to boost its hardware capabilities. it is not just it is notjust about it is not just about software. it is notjust about software. it is all about the hardware. let's look at the markets briefly. in europe they are all on the way up. they are reacting to the fed. the big winners
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today are the banking stocks. we've talked this week about how firms use our data to target adverts, but how can that data be used to change the way businesses operate? well — it's known as business intelligence and analytics and the market for it is forecast to exceed $18 billion this year. that's up over 7% from the year before. 0ne firm cashing in on that is a firm called qualtrics. it was founded in a basement 15 years ago by two brothers and their dad and helps firms improving what they offer to customers. it has 8,000 customers and is valued at more than $1 billion, giving it that mythical unicorn status. we probably need to explain that! we'rejoined by ryan smith, the co—founder and chief executive of qualtrics. welcome. let's talk about the unicorn thing. we love to band around this title but it is nice to
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be that. just explain it to 0scars matt we did not set out and say we wa nt to matt we did not set out and say we want to be a unicorn that something happened in 2014 where people became valued at over $1 billion. then this unicorn started taking off and it started with 30 or 40 companies, now there are 170 and then there is the deco unicorn. what is that? it has kind of fizzled out a little bit. do you get together, the 140 unicorn i you get together, the 140 unicorn 's? you have to have a big unicorn stall to get everyone together. i think that was more of the 2015 thing. let's just think that was more of the 2015 thing. let'sjust talk think that was more of the 2015 thing. let's just talk about your company. you started it with your brother and dad a long time ago in a basement. it sounds like a cliche now, in the garage we start a company and we have apple. we create
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softwa re company and we have apple. we create software which helps organisations collect experienced data. we have been at it for a long time and now we are in a world where we have a true experience economy. if someone is excited or not excited about and experience, they will tell the world, so we want brands to catch that. give us an example of how this can change the way business works. so they find out something about their customers? they have to be really good at understanding their customers. if an experience is not going well or they have a gap they think they are providing a great experience to the customers but the reality is someone on the other end is experiencing something totally different so we will help them close that loop so it comes a lot closer together. the experience they are providing is reality with what someone providing is reality with what someone is stealing. what do you provide for your clients? 0bviously, you provide this information but presumably years ago, they had
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people in their business who did exactly that. are you saving them time and money? we are giving them a softwa re time and money? we are giving them a software which can automate the entire customer journey software which can automate the entire customerjourney or process. they are not having to go out and hirea they are not having to go out and hire a consulting firm. they are getting really good at it and it is becoming a competitive advantage in turn early within a brand that if you own this and your team israeli good at this, that is probably all we will be competing on in the future. everyone has smart developers and engineers, but we love good experiences, and we are willing to do crazy things to go and get a good experience as consumers. just quickly, because i will get into trouble for getting out of time, you are a unicorn and you have a lot of attention and companies investing in new, will you float on the market and become another tech ipo that everyone will get excited about? i think that is where we are headed. we have been at this a long time so we are not an overnight
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success but we will be a great public company. that is what we are lining up and we are all excited about that. we will watch this space. come and see us when you do. thank you, ryan smith, the co—founder of qualtrics. here is how you can get in touch. we will keep you up—to—date with all the insight and analysis from the tea m the insight and analysis from the team of business editor is right around the world and we want to hear you as well. get involved on the bbc business live website. and you can find us on twitter and facebook. business live on tv and online, whenever you need to know. joining us again is nandini ramakrishnan, global market strategist atjp morgan asset management. nice to see you. this is interesting
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in the wall streetjournal. no one is buying cds any more. now through digital purchasing there is a 17% increase in music sales. it looks like the industry is alive and well but it is shifting the mode. that is good news for apple and spotify bet you wonder about the traditional suppliers. vinyl, there has been a real resurgence in that trend? perhaps it is the middle chunk of the market which is not getting the revenues. the digital and the very retro stuff is getting support from consumers on either side. we often talk about the argument between the artists and the services, taylor swift has done a deal but it is about whether they get paid enough? the news is big celebrities and artists who want to get compensated for their work but it is a challenge
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like any other industry they will have to wade through. are you a stream? yes, i listen to music through online streaming. one viewer says they love getting the whole album downloaded. christopher says he still buys and uses the quaint old things called compact discs and it is much better than downloads for quality. peter likes cds and he says are older vinyl albums are not released on cds. 0ne are older vinyl albums are not released on cds. one person says if you really like it, go and buy the real thing. thank you, you really like it, go and buy the realthing. thank you, nandini ramakrishnan. thank you for your company. that's it from business live today. we'll see you again tomorrow. bye— bye. good morning. it might be a mild
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start this morning compared to the last few mornings but for some of us we have some pretty heavy rain out there at the moment, which will gradually move its weight eastwards through the course of the day. the rain is being provided by this weather front here. it is stretching across many western areas. it is a wavy weather front which means some intense areas of rain. eventually, the whole band of rain will move off to the east. we will see some dry, brighter weather ahead of that. but hide the cold front, as it moves eastwards, it will turn fresher through the course of the afternoon. temperatures around 12 to 14 celsius. most of the rain clears away apart from some patchy rain in the far north—east. some brighter weather for northern ireland, the far north—east. some brighter weatherfor northern ireland, wales and the south—west of england with
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some sunshine. the rain continuing across eastern areas except the far south and east where temperatures will get up to 19 or 20 degrees. that bit fresher towards the west. the weather front will continue to clear eastwards and as it clears away, and with the clear skies across many areas, it will turn quite chilly into the early hours of friday morning. temperatures in towns and cities, nine to 11 celsius. in the countryside, maybe six or seven celsius. a bit of a chilled first thing on friday morning but for many of us it will bea dry morning but for many of us it will be a dry and bright start. rain moves into northern ireland. a bit of breeze picking up as well. for much of southern and eastern parts of england it will be dry and sunny. temperatures up to 18 or 19. for the weekend, this big area of low pressure thankfully will stay out towards the west. the high—pressure
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rich will dominate things for many of us on saturday. there will be if you bright or sunny spells, quite breezy across the west. i think we will miss the strongest winds here. it will get even warmer on sunday, especially in the east. a bit more in the way of rain coming into the western areas, particularly towards the south. we are looking closer at this area of rain here, into cornwall by the end of the day. more details can be found on the website. bye— bye. hello it's thursday, it's 9am, i'm chloe tilley, welcome to the programme. mexico asks other countries for help in a race against time to find survivors after tuesday's devastating earthquake. in mexico city, rescuers are trying to reach three trapped people including a 13—year—old girl at the site of a collapsed school. translation: when she told us her name she also told us there were two
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other kids and other bodies but at this point we do not know if they are dead or alive. we are able to hear three different people. we'll have the latest from the scene. also this morning, should cyclists face tougher penalties for riding dangerously? the government launches a review into whether the law needs to change. and why police in some parts of the uk are asking charities to help them keep the community safe. most
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